The course aims to provide participants with a clear understanding of the methodology and logic behind the payroll process. Many people see payroll as simply a position whereby data is entered, a button is pushed and a computer calculates the result. This is far from correct. Payroll professionals need to understand the manual procedures involved to ensure the accuracy of payments. Incorrect pays can result in demoralised and angry staff members which then impacts severely on the company’s profitability. An error in the pay department can have far reaching effects in relation to legislative compliance.

Foundations of Payroll Practice is a course specifically designed to meet the learning requirements of staff new to payroll and staff returning to the payroll office who wish to refresh their skills. Over three days this course aims to ensure that a participant will be able to understand fully the skills and characteristics required of a payroll person and how to apply this knowledge within the workplace. At the end of the course staff will be able to:

• Read and interpret an award
• Use the award to calculate pays
• Read and interpret tax tables
• Calculate tax offsets and understand the effect of the offsets on an employee’s tax
• Calculate entitlements
• Prepare terminations payments
• Carry out month and year reporting and remitting requirements
• Understand Superannuation and calculation of the levy.

The first day concentrates on the pay office (location, setup and function) the current Industrial Relations Scene and interpretation of conditions of employment (we use an award for our examples, but it could easily be an Enterprise Agreement). The ability to interpret awards and legislation is a vital attribute for a payroll person. By the completion of the day participants will able to interpret the award to locate information such as overtime rates and shift allowances, entitlement rates and identify categories of employees (then using this information, allocate the correct payment rate). The day continues with a discussion of Annual Leave and Long Service Leave under the Fair Work Act. Participants will be provided with hands on experience in the calculation of an employee’s length of service and leave entitlements.

The morning of day two continues the focus on entitlements:

• Personal/Carer’s Leave and Parental Leave entitlements
• Accrual of entitlements
• Categories of employees who have access to entitlements
• Legislation governing the administration of entitlements
• Calculation of entitlements.

The afternoon deals with payroll calculations including ordinary pay, overtime, leave and allowances. Tax treatments are explained including PAYG, HELP, tax offsets and the completion and lodgment of Tax File number declarations. The day completes with ‘whiteboarding’ the calculation of tax on bonuses and commissions.

Day Three commences with termination payments –

• Identification of the components of a termination
• The correct tax treatment of these components
• Defining the allocation of these components as Lump Sum A, B, D, ETP

The participants are provided with templates to aid in the calculation of marginal tax and complete exercises to test their knowledge of the processing of terminations.

Having devoted a couple of hours to terminations we move onto superannuation – calculation of the levy, Super guarantee charge and salary sacrificing.

The day concludes with two sections which outline the month and year end reporting and remittances requirements for payroll staff. The varying remittance requirements for PAYG are covered as well as the thresholds and percentages payable to state governments for payroll tax.

Termination payments often pose a major hurdle for the payroll department.

• How do you tax entitlements?
• What is marginal tax?
• Classification of Employment Termination Payments
• How an employees age effects their termination payments
• Death of an employee

With the major changes to Employment Termination Payments in July 2007, the issues surrounding terminations have become more complex. This one day course demystifies this bewildering area and provides hands on experience of calculations.

Outline

1 Major Causes of Termination

2 Legal Aspects of Terminations

3 Termination Payments

• Unpaid Salary
• Leave Entitlements
• Employment Termination Payments

i. In Lieu of notice
ii. Severance Payments
iii. Ex Gratia Payments
iv. Sick Leave
v. RDOs

4 Classification of Employment Termination Payments

• transitional and non transitional

5 Taxation of Termination Payments

• Leave Entitlements
• ETPs

i. Invalidity
ii. Early Retirement Schemes
iii. Redundancy
iv. Pre 1/7/1983
v. Transitional
vi. Non Transitional

6 Termination Documentation

• Transitional Pre Payment Statement
• ETP Payment Summary

Attracting and keeping good staff is one of the most important issues faced by employers in today’s tight human resources market. Employers who offer salary packaging can set themselves apart from the rest and clearly define themselves as employers of choice. The one day Salary Packaging and FBT workshop is designed to give payroll officers an understanding of FBT rules and regulations and salary packaging principles. It aims to provide payroll officers with the skills to administer and process salary packages and to understand the FBT ramifications.

The course examines the most effective items to sacrifice and common fringe benefits such as
novated leases, car parking and living away from home allowances. Participants gain experience
in completing calculations of salary sacrifice arrangements including the calculation of the FBT
liability, superannuation adjustments and changes in the amount of PAYG tax which must be
withheld. The course also reviews total remuneration packages and the handling of this form of
remuneration on termination of employment.

1. Fringe Benefit Tax

• Gross up rates and calculation of FBT
• Types of Benefits
i. Loans
ii. Entertainment
iii. Property
iv. Residual
v. Expense payments and the "otherwise deductible rule"

2. Salary Packaging

• Exempt benefits
• Motor vehicles and employee contributions
• Car parking
• LAFHA
i. reasons for payment
ii. accommodation and food component
• Superannuation
• Total Remuneration Packages
• Workplace Giving
• Salary package considerations
• Effective/non effective salary sacrifice
• Payroll tax considerations
• Reportable Fringe Benefit